The bipartisan deal, which will likely be added to a stopgap spending bill passed by the House on Tuesday, is a major victory for both parties that could head off a government shutdown at the end of the week.

McConnell, flanked by top Senate Democrat Chuck Schumer of New York, praised the plan, noting it would rewrite existing defense caps that have "hamstrung our armed forces and jeopardized our national security."

"This bill represents a significant bipartisan step forward," McConnell said. "I hope we can build on this bipartisan momentum and make 2018 a year of significant achievement for Congress, for our constituents and for the country we all love."

"First and foremost, this bipartisan agreement will unwind the sequestration cuts that have hamstrung our armed forces and jeopardized our national security," the Kentucky lawmaker explained. "Secretary Mattis said that, quote, 'no enemy in the field has done more to harm the readiness of our military than sequestration.' "

"We haven't asked our men and women in uniform to do less for our country. We have just forced them to make do with less than they need," he continued. "This agreement changes that."

Also included in the plan is almost $90 billion in disaster aid for hurricane-ravaged Texas, Florida and Puerto Rico.

In addition, the deal would raise the government's borrowing cap to prevent a first-ever default on US obligations that looms in just a few weeks.

Schumer called the plan "the best thing we've done" for the middle class and the US economy.

"We have reached the budget deal that neither side loves but both sides can be proud of," Schumer said.

Not everyone, however, is happy with the agreement, which does nothing to address the plight of "Dreamers," who face deportation after being brought to the U.S. illegally as children.

House Minority Leader Nancy Pelosi of California has already vowed to fight the budget measure.

"We are demanding a commitment from @SpeakerRyan to advance bipartisan legislation to #ProtectDREAMers like that given by @SenateMajLdr," the California Democrat tweeted earlier Wednesday.